Instead of investing in a bank FD, you can invest in the Post Office Time Deposit (TD) scheme. This scheme not only protects your money but also offers a fixed interest rate. This scheme can be beneficial for investors who avoid the risk of the stock market and want a fixed return. So, if you invest Rs 1 lakh in this Post Office scheme, how much money will you earn in 5 years? Let's find out.

How much will you get after investing Rs 1 lakh?

You can deposit money in the Post Office Time Deposit Scheme for 1, 2, 3, or 5 years. The interest rate remains unchanged for the October to December 2026 quarter.

For example, if you invest ₹1 lakh in this scheme, you'll earn approximately ₹7,081 in interest at a 6.9 percent interest rate for a one-year deposit. This means you'll receive a total of ₹1, 07,081 at the end of the term. For two years, you'll earn ₹14,888 in interest at a 7 percent interest rate. For three years, you'll earn approximately ₹23,508 in interest at a 7.1 percent interest rate. However, the highest annual interest rate for a five-year investment is 7.5 percent. Therefore, investing ₹1 lakh will yield ₹144,995 after five years. This means you'll receive a return of approximately ₹44,995.

Can the investment be increased even after the term ends?

After the term of the Post Office TD scheme expires, investors are also allowed to extend the term, subject to certain rules. You can apply for a one-year deposit within six months of the term expiry, for a two-year deposit within 12 months, and for three- and five-year deposits within 18 months. Another important benefit of this scheme is that you can avail tax exemption on five-year time deposits. You can avail a deduction of up to Rs 1.5 lakh on eligible investments. However, the interest earned from the scheme is taxable.

PC: TV9 Bharatvarsh